Washington is growing increasingly alarmed that the Russian government and businesses are using Turkey to evade Western financial and trading restrictions imposed in response to the Kremlin’s invasion of Ukraine six months ago…reports Asian Lite News
Turkey’s top business association has confirmed receiving a letter from the US Treasury warning of possible sanctions if it continues doing business with Russia.
Washington is growing increasingly alarmed that the Russian government and businesses are using Turkey to evade Western financial and trading restrictions imposed in response to the Kremlin’s invasion of Ukraine six months ago.
Turkish President Recep Tayyip Erdogan and Russian counterpart Vladimir Putin agreed to step up economic cooperation at a summit in the Black Sea resort of Sochi earlier this month.
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Official data show the value of Turkish exports to Russia between May and July growing by nearly 50 percent from last year’s figure.
Turkey’s imports of Russian oil are ballooning and the two sides have agreed to transition to ruble payments for the natural gas exported by the Kremlin-tied giant Gazprom.
Deputy Secretary of the Treasury Wally Adeyemo paid a rare visit to Ankara and Istanbul in June to express Washington’s worries that Russian oligarchs and big businesses were using Turkish entities to avoid Western sanctions.
NATO member Turkey — on good terms with both Moscow and Kyiv — has tried to stay neutral in the conflict and refused to join the international sanctions regime.
Adeyemo followed that up with a letter to Turkey’s TUSIAD business association and the American Chamber of Commerce in Turkey warning that companies and banks were in danger of being sanctioned themselves.
TUSIAD said in a statement on Tuesday that is has passed on the letter to Turkey’s foreign and finance ministries.
The letter’s contents were first reported by The Wall Street Journal this week.
“Any individuals or entities providing material support to US-designated persons are themselves at risk of US sanctions,” Adeyemo wrote.
“Turkish banks cannot expect to establish corresponding relationships with sanctioned Russian banks and retain their corresponding relationships with major global banks as well as access to the US dollar and other major currencies.”
The economic cooperation agreement sealed by Erdogan and Putin includes a deal for more Turkish banks to start processing Russia’s Mir payments system.
Turkish officials have not formally responded to Adeyemo’s letter.
Broader cooperation with Russia could help support Turkey’s ailing economy in the runup to next-year’s general election.
Erdogan has previously argued that Ankara cannot join Western sanctions on Moscow because of Turkey’s heavy dependence on Russian oil and natural gas imports.
“Our economy is such that imposing sanctions on Russia would harm Turkey the most,” Erdogan’s foreign policy adviser Ibrahim Kalin said in June.
“We have taken a clear approach. Right now, the Westerners have accepted this.”
Swedish FM confirms NATO talks with Turkey
Swedish Foreign Minister Ann Linde has confirmed that envoys from Finland, Sweden and Turkey are due to meet for talks on Friday over the two Nordic nations joining the NATO.
“The issue is how we should follow up on the agreement that Turkey, Sweden and Finland reached during the NATO summit in Madrid, which was a precondition for Turkey to agree to Sweden’s and Finland’s requests,” Linde told broadcaster SVT on Wednesday.
New members must be unanimously approved but Turkey has blocked Sweden and Finland’s accession to NATO, and has set several conditions for the expansion of the defence alliance.
The two incoming Nordic members have pledged to support Turkey against national security threats, among other commitments.
Deportations are also to be made easier.
Specifically, Turkish President Recep Tayyip Erdogan accused the two of harbouring members of the Syrian YPG Kurdish militia, as well as members of the Gulenist movement.
The YPG is considered to have links to terrorism by some, but is seen by some Western countries to be the most effective fighting force on the ground in Syria against Islamist extremist groups.
Members of the Gulenist network are accused of organising a 2016 coup attempt.
Finnish Foreign Minister Pekka Haavisto said meetings between representatives of the three countries are to take place alternately in Finland, Sweden and Turkey in the future.
State Secretary Oscar Stenstrom for Sweden is due to attend the first talks, according to Linde.
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